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Public BES-entities look for tax relief in The Hague

THE HAGUE–Tax relief will be one of the major issues for the representatives of Bonaire, St. Eustatius and Saba when they meet with the Dutch Ministry of Finance today, Tuesday.

Tax revenues on the three Dutch public entities in 2011 have surpassed the initial amount that had been agreed on when the islands became part of The Netherlands per October 10, 2010. In 2011 the Tax Office collected some US $62 million in taxes alone, excluding the social premiums. This is more than the US $51 million that was collected under the old Antillean system.

Last year, caretaker State Secretary of Finance Frans Weekers agreed to compensate the higher tax revenues by reducing the tax burden. This year, Bonaire, St. Eustatius and Saba will again implore Dutch authorities to give the islands some form of tax relief.

“The meeting with the Ministry is important to discuss adjustments to the tax structure. The 2011 figures show that again too much tax was collected compared to the old situation when we were still part of the Netherlands Antilles,” said Saba Commissioner Chris Johnson.

“We hope that the Ministry of Finance is willing to make adjustments to the tax structure that will lead to a lower tax burden,” said Johnson, who came to The Netherlands together with Lt. Governor Jonathan Johnson, Commissioner Bruce Zagers and Secretary Menno van der Velde for a week of meetings with the Dutch Ministries.

Statia Commissioner Glenville Schmidt said he hoped that something could be done about the new property tax (vastgoedbelasting) which, according to his government, is hampering the economic development of Statia and the other two islands.

“This tax is bad for the investment climate and scares off potential investors,” said Schmidt. The three islands will present a joint proposal in this area. The Statia delegation further consists of Commissioner Koos Sneek and Secretary Jan Helmond.

Another important issue for the three islands is the 10 million euros that was secured earlier this year for nature management as part of the Spring Accord (Lenteakkoord) under the Dutch caretaker cabinet with the support of a few other political parties.

“We understand that this money is on the negotiation table to form a new coalition in The Netherlands,” said Commissioner Johnson. “We hope that the new cabinet will honour this agreement and that the money goes through.”
One of the two parties taking part in the formation talks, the Labour Party PvdA, is not in favour of specifically dedicating the 10 million euros to nature management and protection. The PvdA would rather see the islands themselves decide what causes they want to spend the money on, for example, fighting poverty or improving infrastructure.

Johnson said the three islands had already come to an agreement on the division of the money. They will use the division formula that each island gets one third of one half of the funds. The second half is to be divided based on the size of each island’s population, meaning that the larger island receives more funds. “This makes the distribution fair,” explained Johnson.

Saba already has some projects in mind in the areas of agriculture, drinking water, solar lighting for roads and trail maintenance. Johnson said the islands would be lobbying in The Hague this week to convince parties that the funds are important.

Other important issues for the Saba delegation this week include a meeting with the Ministry of Economic Affairs, Agriculture and Innovation EL&I about GEBE and the installation of windmills, and a meeting with the Ministry of Infrastructure and Environment I&M about the airport master plan, drinking water facilities and the harbour.

On Wednesday, the three islands will sign an agreement with Dutch caretaker Minister of Education, Culture and Science Marja van Bijsterveldt-Vliegenthart in relation to housing of schools on the public entities. The Statia delegation will also have a meeting at the Ministry of Education, Culture and Science about the Medical School on the island.

Another issue that Statia wants to discuss this week is a training programme for government cleaners. Schmidt explained that there are too many cleaners and that in order to keep finances in check the cost of personnel must go down. “We have a balanced budget this year and we must keep it balanced,” said the Commissioner.

Dutch caretaker Minister of Home Affairs and Kingdom Relations Liesbeth Spies welcomed delegations of Bonaire, St. Eustatius and Saba at the Ministry of the Interior and Kingdom Relations BZK on Monday evening to kick off the Caribbean Netherlands week.

The Minister said she hoped that the meetings in The Hague would be fruitful. She was counting on constructive discussions to make it possible to together move a step further in cooperation between the public entities and the Dutch Government. “There is absolutely work to be done,” she said.

This time the focus will not be on an increase of the free remittance (vrije uitkering) to compensate for the higher cost and inflation in the islands. She said the islands would need to lobby to keep the 10 million euros for nature management and protection. “The parties that are forming a new government must hear your message,” she said.

On Thursday, the island delegations will meet with Minister Spies and representatives of her Ministry to discuss a number of current issues. BZK has a coordinating role in the relations between the islands and The Hague.